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Understanding The Real Estate Purchase Agreement

NOW THAT YOU HAVE FOUND THE RIGHT HOME, WHAT DO YOU DO NEXT?

You may feel more comfortable reviewing, and becoming familiar with a copy of the real estate purchase agreement prior to writing an offer on the home you wish to purchase. You may need to move quickly. So now is the ideal time to become familiar with this contract.

At the time the offer is made, a “good faith” (earnest money) deposit is customary (typically 3% of the purchase price). Prior to accepting your offer, most sellers will also require a preapproval letter and evidence of your down payment. Once the offer is accepted, your earnest money will be deposited into a trust account held by the escrow company.

The real estate purchase agreement (written offer) will specify the price you are offering, escrow period, amount of the down payment, contingencies and other items. Although, it may appear to be quite complex, the Harb and Co. Team are here to answer any questions. When writing the offer, we may suggest adding certain provisions to the offer, some of which might be:

Inspection contingency: You have the opportunity to have the home inspected by a home inspector to determine that the condition of the home is acceptable.

Loan contingency: That you are able to obtain financing (qualify for the loan).

Request any personal property (items that are not attached to the home). Generally, most aspects of the property that are fastened down or are an integral part of the structure (such as light fixtures, window coverings and hardware, trees and shrubs) are included. Unattached bookcases, swag lamps, and potted plants are not included. If there is any uncertainty as to the inclusion of an item now is the time to address this issue.

The seller to provide a Home Protection Plan for you. This plan insures certain components of the home during your first year of ownership.

Your lender should have explained to you the approximate cost of home ownership. If not please let us know so that we can discuss down payment and closing cost requirements.

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